Neoliberalism, what happened?

Extrait de: Breaking Free of Trump's Trap on Trade and Jobs

Why progressives, not Trump, should be leading charge on manufacturing and outsourcing, By Les Leopold, Common Dreams, Monday, January 09, 2017

clip_image001What happened?

Neoliberalism happened. By the time Bill Clinton was elected president both political parties had imbibed the Kool-Aid of tax cuts, deregulation, reductions in government social spending and the undermining of unions. So-called “free-trade” agreements were the centerpiece of the new neoliberal order. All boats were supposed to rise.

But instead of good paying jobs, neoliberalism created runaway inequality with no end in sight. The biggest victims were the poor in declining urban areas, displaced manufacturing workers, and Mexican farmers.

Unions that represented manufacturing workers (like the United Steelworkers, the United Autoworkers and the Communications Workers of America) fought like hell against these trade agreements and took every opportunity to protest against unfair trade. But enough Democrats always sided with the Republicans to pass NAFTA and other corporate-friendly trade measures. Meanwhile U.S. manufacturing fell from 20.1 percent of all jobs in 1980 to only 8.8 percent by 2013.

All along, pundits and academics never tired of telling us that it was inevitable. Erroneously, they said the job loss was really caused by automation and skills mismatches between dislocated workers and the new jobs that supposedly were waiting to be filled. Few bothered to look at Germany which has at least the same level of technology but instead developed a booming manufacturing sector. (See here)

Instead both political parties placed all their bets on the rise of high finance. Deregulating Wall Street would make our IRAs and pensions soar (and fill party campaign coffers as well.) It would build a new service economy and lead the U.S. into a new era of prosperity. You know what happened.

Unfortunately, the neoliberal order impacted the work of progressives as well.

·       Working class issues became less important as organizational silos were created around identity and environmental issues.

·       Philanthropic funding for plant closings fights waned. And as good working class jobs become increasingly insecure, manufacturing workers feared that the fight against climate change could cost them their jobs.

Enter Trump

Progressives are struggling to understand what went wrong: Was it the Russians hackers? the FBI surprise? the electoral college? racism, sexism, and xenophobia? Even taken together, these factors do not sufficiently account for how poorly Clinton underperformed Obama: minus 290,000 votes in Pennsylvania, minus 222,000 votes in Wisconsin and a whopping minus 500,000 votes in Michigan. It’s difficult to claim that all those who switched from Obama to Trump were racists, misogynists, etc.

The alternative account is that the neoliberal Democratic Party, exemplified by Hillary, had done nothing to save manufacturing jobs (except the GM bailout during the crash). Worse still, Obama, the party’s leader, was pushing hard for another corporate-friendly trade bonanza (the Trans-Pacific Partnership Act), and everyone knew Hillary was for it before she was against it.

The election might have turned out very differently if Obama had spent the last eight years blasting the likes of GM, Ford, Carrier and hundreds of other companies for shipping good paying jobs to Mexico. It would have helped if the Democrats had proposed legislation to prevent the off-shoring of good manufacturing jobs. But Obama and the Democratic Party establishment sipped from the same neo-liberal Kool-Aid: They believed in the blessings of corporate trade, and too many working people believed they were wrong.

Jobs for poor Mexican workers versus jobs for higher paid U.S. workers?

The abdication of the jobs issue to Trump also is connected to the mistaken notion that protecting jobs in the U.S. harms low income people in developing countries like Mexico. But NAFTA has failed to help impoverished factory workers and farmers in Mexico, reports the New York Times. It is painfully obvious that the threat of factory relocations has harmed the bargaining power of workers here and abroad.

The big NAFTA winners are financial and corporate elites.

1. Recognize the scope of the problem: The first step is to understand that the off-shoring of jobs to low wage areas is an enormous problem. “Somewhere between 22 and 29 percent of all U.S. jobs are, or will be, potentially off-shorable within a decade or two,” reports Princeton economist Alan Blinder.

It is very telling that the government does not keep separate off-shoring data so we don’t know exactly how many layoffs are caused by moving jobs abroad. But it is undoubtedly the case that hundreds of thousands of working people are finding out each year that their jobs will be leaving the U.S. to lower wage areas.

2. Renounce the free movement of capital: We need to challenge capital mobility ― the neoliberal holy sacrament that claims nothing ever should limit the ability of capital to move whenever and wherever it wants. Over 40 years ago, Nobel laureate James Tobin argued that this would inevitably lead to the destruction of social programs and the downward pressure of wages. He was right then and still is. We need to say loud and clear that corporations and their Wall Street puppeteers, shall not be allowed to simply pick up and go to another country for the purpose of securing lower wages and fewer health, safety and environmental regulations. There is nothing sacred about the free flow of capital when it devastates community after community.

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3. Organize those threatened with off-shoring: Our job is to reach those workers ― millions of them ― with a very simple message: We demand that Donald Trump and Congress save our jobs as well.

This is a golden opportunity for progressive organizing. Unions and community groups should locate these workers, encourage them to sign petitions, recruit them to show up at Trump events, picket the White House, pressure their congressional representatives and fight for their jobs. Also, support should be built for the kind of anti-offshoring legislation Sanders is offering in the Senate.

4. Off-shoring as an environmental issue. Moving jobs to low-wage areas inevitably means moving towards lower regulatory environments. The factories in China, Mexico and Vietnam do not have anything like the environmental and health/safety protections found in the U.S. So not only are we off-shoring jobs, but we are off-shoring pollution, especially carbon emissions. In addition, by shifting jobs abroad and then re-importing the goods back to the U.S., the extra transportation increases the carbon footprint of each product. In short, if you care about climate change, you have to care about the off-shoring of U.S. jobs.

For the first time since neoliberalism infected the minds of the political and media establishments, the issue of off-shoring is on the national agenda.

This is the ideal time for unions and progressive organizations to mobilize impacted workers and raise hell.


Les Leopold

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Les Leopold, the director of the Labor Institute in New York is working with unions, worker centers and community organization to build a national economics educational campaign. His latest book, Runaway Inequality: An Activist's Guide to Economic Justice (Oct 2015), is a text for that effort. All proceeds go to support this educational campaign. (Please like the Runaway Inequality page on Facebook.) His previous book is The Looting of America: How Wall Street's Game of Fantasy Finance destroyed our Jobs, Pensions and Prosperity, and What We Can Do About It (Chelsea Green/2009).